Medicare Physician Services: Use of Services Increasing Nationwide and Relatively Few Beneficiaries Report Major Access Problems

Congress, policy analysts, and groups representing physicians have periodically raised concerns that Medicare's efforts to control spending on physician services by limiting annual updates to physician fees could have an adverse impact on beneficiaries' access to physician services. These concerns were heightened in 2002 when Medicare's formula for setting physician fees required a 5.4 percent reduction in fees to help moderate rapid spending increases. From 2003 to 2006, fees have not grown as rapidly as the estimated cost to physicians of providing services, and concerns about access have remained. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 requires GAO to study access to physician services by beneficiaries in the traditional fee-for-service (FFS) program. This report focuses on (1) trends and patterns in beneficiaries' perceptions of the availability of physician services from 2000 through 2004, (2) trends in beneficiaries' utilization of physician services from 2000 through 2005, and (3) indicators of physician supply and willingness to serve Medicare beneficiaries from 2000 through 2005. GAO analyzed the most recent data available, including several years of data from an annual survey of FFS Medicare beneficiaries as well as utilization trends based on all Medicare physician claims for services provided in April of each year from 2000 through 2005.